The morning news. [volume] (Savannah, Ga.) 1887-1900, 1887-08-13
CR0OKEDNESS ALLEGED.
GRAVE CHARGES AGAINST TREAS
URER DANIEL R. KENNEDY


cuss the Situation-Kennedy Denies
that He Stole, But Admits that He
Used the Money-The Amount of the
Deficit Not Known.
A very excited meeting of the stock
holders of the Jasper Mutual Loan Associa-
ton was held at the Secretary's Office last
night, the rumored defalcation of Treasurer
Daniel R. Kennedy being the loadstone to
the anxious stockholders. Some twenty
five had assembled when Director J. S.
Wood called the meeting to order.
A fever of restlessneSs prevail
ed but they managed to restrain
it till the ordinary business was transacted.
AL were on the qui rire when finally Mr..
J. s. Wood arose and, in n grave voice,
said he had bad news for the members. He
then gave the following information.
About a month ago, from some feeling of
insecurity regarding the treaSurerS work,
he inserted the following want" i'll the
MORNING NEWS:
NTANTED, Loan Association stock. Call
w duI1ng forenoon at our office, "a Bay
street j. S. WOOD & BRO.
A STATEMENT DEMANDED.
He received a few answers 10 this and
thought they owned more stock than was
credited to them. To determine who were
the stockholders he then asked for such a
statement from Kennedy. Failing TO get
it in day or two he renewed the request,
and then not securing it Secretary Wooten
served A written order on him 70 make out
full list of all the stockholders
and their standing. This he promised to
do, but put it off from day 20 day Final
ly Mr. Wood went to his Office and was told
that Kennedy was III the country. After
ward he found out that Kennedy had been
TO Baltimore. These delays caused their
suspicious to increase, and they finally de-
manded his resignation, which was given,
and Mr. Charles 5. Wood was appointed in
his place. The following circular was then
sent out, which attracted some attention at
the time and caused some of the members
of the association to feel somewhat agitated
over their prospective gains:
THE AGITATING CIRCULAR.
JASPER MUTUAL LOAN ASSOCIATION,
SAVANNAH, Ga, Aug. 4, 1887 (
DEAR SRI have the honor to inform you
that have this day been elected Treasurer of
the Jasper Mutual Loan Association to ell the
vacancy occasioued hy the retirement of Mr.
d r. Kennedy. late Treasurer. The Board of
Directors instruct me to inform you that those
sections of the constitution and bylaws relating
TO payment of dues and the penalty of fines and
Interest, are to be rigidly enforced hereafter.
They further instruct me to report at the next
meeting, Friday evening, Aug ~ the names Of
all delinquents, TO the end that such accounts
m y be turned over to the solicitor for collec
ton
They further instruct me to say that hereafter
all dues to this association must be paid to me
at the office of !. :. Wood q Co, a Bay street.
on Monday forenoon next preceding the monthly
meeting of this association
Please bring all receipts for previous pay
ments for inspection next Monday. Very re-
specially yours.
CHARLES S. WooD, Treasurer.
NO ACCOUNTS KEPT.
The new treasurer then demanded the
books, which were turned over without
trouble. They were found in a terrible
plight, no work having been done on them
since Jan. last. Mr.. J. S. Wood then be
gan the examination, and for the last ten
days has been engaged upon it. To go over
all the numberless accounts was "a vast
work, but it was partially done,
and the report he had to give
was the result of his labors.
The stock book was all right and the cash
in bank seemed to agree with the balances
of cash and check books. In looking over
these matters other things attracted his
attention and new clues were developed.
Receipts were shown him for interest paid
on advanced payments, but no credit for
such payments could be found. Altogether
he discovered about $4,000 of these pay
ments that they thought Kennedy had
stolen.
A NEATLY CONTRIvED SYSTEM.
While on this search he stumbled on another
plan of Kennedy's, so he reported, which
showed a carefully contrived system of
fraud. All the shares of a loan association
on which loans have been made are called
cancelled stock, to distinguish il from
those on which no loans have been made.
Kennedy's plan, as Mr. Wood explained,
was this: Some member would be
DESTROYS of borrowing. more money
than his ownership of shares
would allow He would then go to Kennedy
and ask him about buying, and he would
fix price trfe lower than the ruling rate
and agree to buy them for him. The pro-
spective borrower would then go to the
meeting and bSi i'll the amount his full stock
would entitle him to. Then going to the
solicitor of the association his securities
were examined, and, il found correct, passed
upon and draft given him on the Treasurer
for the amount due him. He then went to
the Treasurer, who deducted the price of his
supposed purchase from the amount and
gave him his private check for the differ
ence, pocketing the amount charged for the
invisible new stock he Kennedy had
promised to purchase.
HOW THE SCHEME WORKED.
As the borrowers gave their stock over to
the Treasurer TO cancel when they secured
the money, they never asked to see the stock
he was supposed to have bought
for them. thus allowing the
swindle to be perpetrated for a long while
For instance, If borrower had $3.50 net
coming to him, and he had agreed to pay
Kennedy $3.50, say Tor new stock, he re-
ceived S400, the alert Treasurer pocketng
the neat trifle of $3.50 As the certificates
were all kept by the Treasurer, it is easy to
see how this could be done. In this way, it
is claimed, he ISSUED" or received
pay for fifty-nino alleged shares,
at loss to tho association of
some $4,000. Besides this they claim he
borrowed some 900 net from the asso-
citation on his twenty four shares of stock,
and that he never paid any installments
thereon, being now greatly in arrears The
report concluded by saying that all the
books were in n great tangle and though
that was all found so far, Yet there might
be other leaks discovered before the commit
tee was through with them.
A MOTION TO PROSECUTE.
A long drawn sigh was heard when the
report was concluded, AMI dozen spoke at
once, asking for details regarding the def
icit, which the Chairman patiently and
fully gave. To meet this deficit they had
his two houses on Perry street, worth Sl2, 900
or Sl5, 600, now already mortgaged 20 the
association and Kennedy's shares and the
salary due him. The balance due by him